Code of Ethics and Conduct

1. Definition

3A or Company

:

Three-A Resources Berhad (Co no. 481559-M)

3A Group

:

Three- A Resources Berhad and its subsidiaries, collectively

Code of Ethics & Conduct

:

Policy

2. Purpose

The Three-A Resources Bhd group of companies (AAA) Code of Ethics and Conduct establishes standards to ensure that working conditions in the food and beverages industry supply chain are safe, that workers are treated with respect and dignity, and that business operations are environmentally responsible, conducted ethically, managing conflicts of interest, preventing the abuse of power, corruption, insider trading and money laundering.

Considered as part of the food and beverages industry for purposes of this Code are all organizations that may design, market, manufacture or provide goods and services that are used to produce food and beverages goods. The Code may be voluntarily adopted by any business in the food and beverages sector and subsequently applied by that business to its supply chain and subcontractors, including providers of contract labor.

To adopt the Code and become a participant (“Participant”), a business shall declare its support for the Code and actively pursue conformance to the Code and its standards in accordance with a management system as herein.

Participants must regard the Code as a total supply chain initiative. At a minimum, Participants shall also require its next tier suppliers to acknowledge and implement the Code.

Fundamental to adopting the Code is the understanding that a business, in all of its activities, must operate in full compliance with the laws, rules and regulations of the countries in which it operates. 1The Code encourages Participants to go beyond legal compliance, drawing upon internationally recognized standards, in order to advance social and environmental responsibility and business ethics.

The AAA is committed to obtaining regular input from stakeholders in the continued development and implementation of the Code of Conduct.

The Code is made up of five sections. Sections A, B, and C outline standards for Labor, Health and Safety, and the Environment, respectively. Section D adds standards relating to business ethics; Section E outlines the elements of an acceptable system to manage conformity to this Code.

3. Scope

This Code applies to the Company and its subsidiaries. Reference to “Participants” include all employees, shareholders, directors, vendors, consultants or any parties with a business relationship with 3A Group.

A. LABOR

Participants are committed to uphold the human rights of workers, and to treat them with dignity and respect as understood by the international community. This applies to all workers including temporary, migrant, student, contract, direct employees, and any other type of worker. The recognized standards, as set out in the annex, were used as references in preparing the Code and may be a useful source of additional information.

The labor standards are:

1) Freely Chosen Employment
Forced, bonded (including debt bondage) or indentured labor, involuntary prison labor, slavery or trafficking of persons shall not to be used. This includes transporting, harboring, recruiting, transferring or receiving vulnerable persons by means of threat, force, coercion, abduction or fraud for the purpose of exploitation. All work must be voluntary and workers shall be free to leave work at any time or terminate their employment. Workers must not be required to surrender any government-issued identification, passports, or work permits as a condition of employment. Excessive fees are unacceptable and all fees charged to workers must be disclosed.

2) Child Labor Avoidance
Child labor is not to be used in any stage of manufacturing. The term “child” refers to any person under the age of 15 (or 14 where the law of the country permits), or under the age for completing compulsory education, or under the minimum age for employment in the country, whichever is greatest. The use of legitimate workplace apprenticeship programs, which comply with all laws and regulations, is supported. Workers under the age of 18 shall not perform work that is likely to jeopardize the health or safety of young workers.

3) Working Hours
Studies of business practices clearly link worker strain to reduced productivity, increased turnover and increased injury and illness. Workweeks are not to exceed the maximum set by local law. Further, a workweek should not be more than 48 hours per week, excluding overtime, except in emergency or unusual situations. Workers shall be allowed at least one day off per seven-day week.

4) Wages and Benefits
Compensation paid to workers shall comply with all applicable wage laws, including those relating to minimum wages, overtime hours and legally mandated benefits. In compliance with local laws, workers shall be compensated for overtime at pay rates greater than regular hourly rates. Deductions from wages as a disciplinary measure shall not be permitted. The basis on which workers are being paid is to be provided in a timely manner via pay stub or similar documentation.

5) Humane Treatment
There is to be no harsh and inhumane treatment including any sexual harassment, sexual abuse, corporal punishment, mental or physical coercion or verbal abuse of workers; nor is there to be the threat of any such treatment. Disciplinary policies and procedures in support of these requirements shall be clearly defined and communicated to workers.

6) Non-Discrimination and Harassment
Participants should be committed to a workforce free of unlawful discrimination and harassment. Companies shall not engage in discrimination based on race, color, age, gender, sexual orientation, ethnicity, disability, pregnancy, religion, political affiliation, union membership or marital status in hiring and employment practices such as promotions, rewards, and access to training. In addition, workers or potential workers should not be subjected to medical tests that could be used in a discriminatory way. Participants should not be engaged in any kind of verbal or physical harassment based on any of the above and reason.

7) Freedom of Association
Open communication and direct engagement between workers and management are the most effective ways to resolve workplace and compensation issues. The rights of workers to associate freely, join or not join labor unions, seek representation, and join workers’ councils in accordance with local laws shall be respected. Workers shall be able to openly communicate and share grievances with management regarding working conditions and management practices without fear of reprisal, intimidation or harassment.

B. HEALTH and SAFETY

Participants recognize that in addition to minimizing the incidence of work-related injury and illness, a safe and healthy work environment enhances the quality of products and services, consistency of production and worker retention and morale. Participants also recognize that ongoing worker input and education is essential to identifying and solving health and safety issues in the workplace.

Recognized management systems such as OHSAS 18001 and ILO Guidelines on Occupational Safety and Health were used as references in preparing the Code and may be a useful source of additional information.

The health and safety standards are:

1) Occupational Safety
Worker exposure to potential safety hazards (e.g., boiler, electrical and other energy sources, fire, vehicles, and fall hazards) are to be controlled through proper design, engineering and administrative controls, preventative maintenance and safe work procedures (including lockout/tagout), and ongoing safety training. Where hazards cannot be adequately controlled by these means, workers are to be provided with appropriate, well-maintained, personal protective equipment. Workers shall not be disciplined for raising safety concerns.

3) Occupational Injury and Illness
Procedures and systems are to be in place to prevent, manage, track and report occupational injury and illness including provisions to: encourage worker reporting; classify and record injury and illness cases; provide necessary medical treatment; investigate cases and implement corrective actions to eliminate their causes; and facilitate return of workers to work.

4) Industrial Hygiene
Worker exposure to chemical, biological and physical agents is to be identified, evaluated, and controlled. Engineering or administrative controls must be used to control overexposures. When hazards cannot be adequately controlled by such means, worker health is to be protected by appropriate personal protective equipment programs.

5) Physically Demanding Work
Worker exposure to the hazards of physically demanding tasks, including manual material handling and heavy or repetitive lifting, prolonged standing and highly repetitive or forceful assembly tasks is to be identified, evaluated and controlled.

6) Machine Safeguarding
Production and other machinery shall be evaluated for safety hazards. Physical guards, interlocks and barriers are to be provided and properly maintained where machinery presents an injury hazard to workers.

7) Sanitation, Food, and Housing
Workers are to be provided with ready access to clean toilet facilities, potable water and sanitary food preparation, storage, and eating facilities. Worker dormitories provided by the Participant or a labor agent are to be maintained to be clean and safe, and provided with appropriate emergency egress, hot water for bathing and showering, adequate heat and ventilation, and reasonable personal space along with reasonable entry and exit privileges.

C. ENVIRONMENTAL

Participants recognize that environmental responsibility is integral to producing world class products. In manufacturing operations, adverse effects on the community, environment and natural resources are to be minimized while safeguarding the health and safety of the public.
Recognized management systems such as ISO 14001 and the Eco Management and Audit System (EMAS) were used as references in preparing the Code and may be a useful source of additional information.

The environmental standards are:

1) Environmental Permits and Reporting
All required environmental permits (e.g. discharge monitoring), approvals and registrations are to be obtained, maintained and kept current and their operational and reporting requirements are to be followed.

2) Pollution Prevention and Resource Reduction
Waste of all types, including water and sludge, are to be reduced or eliminated at the source or by practices such as modifying production, maintenance and facility processes, materials substitution, conservation, recycling and re-using materials.

3) Hazardous Substances
Chemicals and other materials posing a hazard if released to the environment are to be identified and managed to ensure their safe handling, movement, storage, use, recycling or reuse and disposal.

4) Wastewater and Solid Waste
Wastewater and solid waste generated from operations, industrial processes and sanitation facilities are to be characterized, monitored, controlled and treated as required prior to discharge or disposal.

5) Air Emissions
Wastewater and solid waste generated from operations, industrial processes and sanitation facilities are to be characterized, monitored, controlled and treated as required prior to discharge or disposal.

6) Product Content Restrictions
Participants are to adhere to all applicable laws, regulations and customer requirements regarding prohibition or restriction of specific substances, including labeling for recycling and disposal.

D. ETHICS

To meet social responsibilities and to achieve success in the marketplace, Participants and their agents are to uphold the highest standards of ethics including:

1) Business Integrity, Bribery And Corruption
The highest standards of integrity are to be upheld in all business interactions. Participants shall have a zero tolerance policy to prohibit any and all forms of bribery, corruption, extortion and embezzlement (covering promising, offering, giving or accepting any bribes). All business dealings should be transparently performed and accurately reflected on Participant’s business books and records. Monitoring and enforcement procedures shall be implemented to ensure compliance with anti-corruption laws.

2) Insider Trading and Money Laundering
AAA prohibits the purchase and sale of AAA shares or securities on the basis of potentially share price relevant information which is not yet public. AAA acknowledge an importance of preventing money laundering, terrorist financing and financing of proliferation.

3) Disclosure of Information
Information regarding business activities, structure, financial situation and performance is to be disclosed in accordance with applicable regulations and prevailing industry practices. Falsification of records or mis-representation of conditions or practices in the supply chain are unacceptable.

4) Intellectual Property
Intellectual property rights are to be respected; transfer of technology and know-how is to be done in a manner that protects intellectual property rights.

5) Fair Business, Advertising and Competition
Standards of fair business, advertising and competition are to be upheld. Appropriate means to safeguard customer information must be available.

6) Fraud, protection of company assets, accounting
Participants must never engage in fraudulent or any other dishonest conduct involving the property or assets or the financial reporting and accounting of AAA, it subsidiaries or any third party. Participant shall safeguard and make only proper and efficient use of AAA group’s property. All participants shall seek to protect AAA’s property from loss, damage, misuse, theft, fraud, embezzlement and destruction. These obligation cover both tangible and intangible assets, including trademarks, know-how, confidential or proprietary information and information systems.

7) Privacy
Participants are to commit to protecting the reasonable privacy expectations of personal information of everyone they do business with, including suppliers, customers, consumers and employees. Participants are to comply with privacy and information security laws and regulatory requirements when personal information is collected, stored, processed, transmitted, and shared.

8) Non-Retaliation
Participants should have a communicated process for their personnel to be able to raise any concerns without fear of retaliation.

9) Guidance on Gifts, Meal and Entertainment
Participants are not allowed to offer or accepting or exchange gifts, meals or entertainment that look like an attempt to improperly influence a business decision. No matter you are the giver or the recipient, you need to recognize when an offer is excessive under AAA policy.

Decline gifts, meals and entertainment of any value from current or potential suppliers, customers or other business partners if it would create the appearance of a conflict of interest. And never request gifts, meals, entertainment or favors from the above mentioned parties – doing so is a violation our code.

In the event, if participant face difficult to refuse a gifts, especially worried about insulting the giver or you have been presented with a gift in front of a group. In such case, participant required to immediately notify and declare to company HR or Disciplinary Committee, who will work together to donate, distribute or raffle it among a large group of employees. Participant also encourage to share our AAA’s rules regarding gift, meals and entertainment with the giver to prevent similar situation is future.

10) Conflict of Interest
Participants shall avoid Conflict of Interest whenever possible. A Conflict of Interest occurs when personal interest of an employee or the interests of a third party compete with the interests of AAA. If a Conflict of Interest situation occurred or potentially or lead to a Conflict of Interest, the participant shall disclose it to Line Manager and/or the HR or Disciplinary Committee or Whistleblowing Committee to resolve the situation in a fair and transparent manner.

E. MANAGEMENT SYSTEM

Participants shall adopt or establish a management system whose scope is related to the content of this Code. The management system shall be designed to ensure: (a) compliance with applicable laws, regulations and customer requirements related to the participant’s operations and products; (b) conformance with this Code; and (c) identification and mitigation of operational risks related to this Code. It should also facilitate continual improvement.

The management system should contain the following elements:

1) Company Commitment
A corporate social and environmental responsibility policy statements affirming Participant’s commitment to compliance and continual improvement, endorsed by executive management.

2) Management Accountability and Responsibility
The Participant clearly identifies company representative[s] responsible for ensuring implementation of the management systems and associated programs. Senior management reviews the status of the management system on a regular basis.

3) Legal and Customer Requirements
A process to identify, monitor and understand applicable laws, regulations and customer requirements, including the requirements of this Code.

4) Risk Assessment and Risk Management
A process to identify the environmental, health and safety3 and labor practice and ethics risks associated with Participant’s operations. Determination of the relative significance for each risk and implementation of appropriate procedural and physical controls to control the identified risks and ensure regulatory compliance.

5) Improvement Objectives
Written performance objectives, targets and implementation plans to improve the Participant’s social and environmental performance, including a periodic assessment of Participant’s performance in achieving those objectives.

7) Communication
A process for communicating clear and accurate information about Participant’s policies, practices, expectations and performance to workers, suppliers and customers.

8) Worker Feedback and Participation
Ongoing processes to assess employees’ understanding of and obtain feedback on practices and conditions covered by this Code and to foster continuous improvement.

9) Audits and Assessments
Periodic self-evaluations to ensure conformity to legal and regulatory requirements, the content of the Code and customer contractual requirements related to social and environmental responsibility.

11) Documentation and Records
Creation and maintenance of documents and records to ensure regulatory compliance and conformity to company requirements along with appropriate confidentiality to protect privacy.

12) Supplier Responsibility
A process to communicate Code requirements to suppliers and to monitor supplier compliance to the Code.

REPORTING ILLEGAL OR NON-COMPLIANT CONDUCT

Participants shall report any practices or actions believed to be inappropriate, unlawful and unethical under this Code of Conduct or even illegal to their Line Managers or the appropriate members of the HR or Disciplinary Committee. If it is appropriate, in view of the nature of the reported matter, reports of violations may be made directly to higher levels including the group directors or whistleblowing committee.

All complaints shall be properly investigated. AAA prohibits retaliation against any party for such reports made in good faith, while it also protects the rights of the incriminated person.

OTHERS
THREE-A RESOURCES BERHAD ("3A" OR THE "COMPANY") - PROPOSED RENEWAL OF AUTHORITY FOR SHARE BUY-BACK - PROPOSED RENEWAL OF SHAREHOLDERS MANDATE FOR THE COMPANY AND/OR ITS SUBSIDIARIES TO ENTER INTO RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE
13 Apr 2018